Renault and Nissan merge key business functions

The French and Japanese motoring giants, Renault and Nissan, have decided to strengthen their bonds. The Renault-Nissan alliance has announced that it will merge four of their key business functions to achieve synergies of approximately Rs 365 crore annually by 2016.

The four key operational areas that will be merged include engineering, manufacturing and supply chain management, purchasing and human resources. A newly appointed alliance vice- president will take charge of increasing the integration of each function.

In terms of engineering, Renault and Nissan will combine Common Module Family (CMF) engineering, advanced research, powertrain development (including electric vehicles), systems engineering and testing facilities and services.

Carlos Ghosn, Renault-Nissan Chairman and CEO, says, “Convergence within these four key business functions will result in an immediate increase in efficiency and leverage our size to achieve competitive economies of scale.”

“The synergies will then enable us to deliver higher-value vehicles to customers and stay at the leading edge of innovation,” he adds.

Renault-Nissan formed an alliance on March 27, 1999. The world’s fourth largest carmaker by volume claims to have the longest lasting and most productive cross-cultural collaboration in the auto industry. The companies have already integrated several functions, including information technology, logistics, customs and trade, and purchasing.